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Sun Life Financial statement on Washington Mutual holdings

TORONTO, Sept. 26 /CNW/ - In response to the notice issued by the United
States Federal Deposit Insurance Corporation in respect of Washington Mutual
Inc., Sun Life Financial Inc. (TSX/NYSE: SLF) today announced the following
exposures:
Washington Mutual Inc:
- Bond securities with a par value of $18 million
Washington Mutual Bank:
- Bond securities with a par value of $134 million
Washington Mutual Preferred Funding:
- Bond securities with a par value of $118 million
The majority of Sun Life Financial's Washington Mutual exposure is held
in segments backing liabilities. Under Canadian accounting rules, when a bond
backing liabilities is written down in value or defaults, the actuarial
assumptions about the cash flows required to support the liabilities will
change, resulting in a strengthening of reserves with a corresponding charge
to income.
Sun Life Financial currently expects to record a charge to earnings in
the third quarter of 2008 in respect of its holdings in Washington Mutual. The
amount of the charge is dependent on a number of factors, including the amount
of expected recoveries and actuarial cash flow testing which is performed
following the close of the quarter on September 30, 2008.
Sun Life Financial has a high quality, diversified investment portfolio
with over $100 billion in invested assets as of June 30, 2008. Sun Life's $60
billion bond portfolio is highly diversified across 1400 different borrowers
around the world and is rated 97% investment grade. The aggregate exposures to
Washington Mutual discussed above represent less than one percent of Sun
Life's invested assets. Sun Life Financial continues to have a strong balance
sheet, is well capitalized and is very well positioned to fulfill all of its
obligations.
About Sun Life Financial
Sun Life Financial is a leading international financial services
organization providing a diverse range of protection and wealth accumulation
products and services to individuals and corporate customers. Chartered in
1865, Sun Life Financial and its partners today have operations in key markets
worldwide, including Canada, the United States, the United Kingdom, Ireland,
Hong Kong, the Philippines, Japan, Indonesia, India, China and Bermuda. As of
June 30, 2008, the Sun Life Financial group of companies had total assets
under management of CDN$413 billion.
Sun Life Financial Inc. trades on the Toronto (TSX), New York (NYSE) and
Philippine (PSE) stock exchanges under ticker symbol SLF.
Forward-Looking Statements
Certain statements in this document, including statements that are
predictive in nature, that depend upon or refer to future events or
conditions, or that include words such as "expects", "anticipates", "intends",
"plans", "believes", "estimates" or similar expressions, are forward-looking
statements within the meaning of securities laws. Forward-looking statements
include the information concerning possible or assumed future results of
operations of the Company. These statements represent the Company's
expectations, estimates and projections regarding future events and are not
historical facts. Forward-looking statements are not guarantees of future
performance and involve certain risks and uncertainties that are difficult to
predict. Future results and stockholder value may differ materially from those
expressed in these forward-looking statements due to, among other factors, the
matters set out under "Risk Factors" in the Company's AIF and the factors
detailed in its other filings with Canadian and U.S. securities regulators,
including its annual and interim MD&amp;A, and financial statements, which are
available for review at www.sedar.com and www.sec.gov.
Factors that could cause actual results to differ materially from
expectations include, but are not limited to, the performance of equity
markets; interest rate fluctuations; investment losses and defaults; movements
in credit spreads; the cost, effectiveness and availability of risk mitigating
hedging programs; the creditworthiness of guarantors and counterparties to
derivatives; risks related to market liquidity; changes in legislation and
regulations including tax laws; regulatory investigations and proceedings and
private legal proceedings and class actions relating to practices in the
mutual fund, insurance, annuity and financial product distribution industries;
risks relating to product design and pricing; insurance risks including
mortality, morbidity, longevity and policyholder behaviour including the
occurrence of natural or man-made disasters, pandemic diseases and acts of
terrorism; risks relating to operations in Asia including risks relating to
joint ventures; currency exchange rate fluctuations; the impact of
competition; risks relating to financial modelling errors; business continuity
risks; failure of information systems and Internet enabled technology;
breaches of computer security and privacy; the availability, cost and
effectiveness of reinsurance; the inability to maintain strong distribution
channels and risks relating to market conduct by intermediaries and agents;
dependence on third party relationships including outsourcing arrangements;
downgrades in financial strength or credit ratings; the ability to
successfully complete and integrate acquisitions; the ability to attract and
retain employees; and the performance of the Company's investments and
investment portfolios managed for clients such as segregated and mutual funds.
The Company does not undertake any obligation to update or revise these
forward-looking statements to reflect events or circumstances after the date
of this report or to reflect the occurrence of unanticipated events, except as
required by law.
Note to Editors: All figures in Canadian dollars.